Pilla Durga Prasad vs Jogiparthi Venkata Satish
2023 Latest Caselaw 5124 AP

 THE HON'BLE SRI JUSTICE CHEEKATI MANAVENDRANATH R0Y

               Civil Revision Petition No.1679 of 2019

ORDER:

Aggrieved by the order, dated 02.07.2018, passed in I.A.

No.429 of 2018 in O.S.No.118 of 2012 on the file of the IV

Additional District Judge, Guntur, whereby the petition filed

under Order 7 Rule 11 and Section 151 CPC to reject the plaint,

was dismissed, the instant Civil Revision Petition has been

preferred by the revision petitioner.

2) Heard Sri S.S.Prasad, learned senior counsel appearing on

behalf of the revision petitioner, and Smt.V.Dyumani, learned

counsel for respondents 1 and 2. None appeared for respondents

3 to 5.

3) Parties will be referred as they are arrayed in the plaint for

the sake of convenience.

4) The plaintiffs have filed the Suit in O.S.No.118 of 2012 on

the file of the IV Additional District Judge, Guntur, for eviction of

the defendants from the plaint schedule premises and to deliver

vacant possession of the same to the plaintiffs and also for

recovery of arrears of rent and for damages for use and occupation

of the plaint schedule premises.

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5) As per the factual foundation laid in the plaint for filing the

said Suit, it is pleaded that the plaintiffs are the absolute owners

of the plaint schedule premises and they are joint owners of the

said premises and the 1st defendant Aditya Motors approached the

1st plaintiff with a request to lease out the plaint schedule

premises to the said Aditya Motors and the plaintiffs have agreed

to lease out the said premises to Aditya Motors. Accordingly, a

registered lease deed, dated 13.04.2005, was executed by the 1st

plaintiff on his behalf and on behalf of the 2nd plaintiff, as per the

authorization given to him by the 2nd plaintiff, leasing out the

plaint schedule premises to the 1st defendant Aditya Motors.

Thereafter, the 1st defendant has inducted the 2nd defendant M/s.

Associated Auto Services (P) Ltd, a company for which defendants

3 and 4 are directors, in the said premises without the consent of

the plaintiffs. It is stated that after expiry of the lease period by

efflux of time as the defendants did not vacate the premises, that

notice under Section 106 of the Transfer of Property Act was given

to the 1st defendant and also to the defendants 2 to 4 to vacate the

premises and deliver possession of the same to the plaintiffs. It is

stated that the defendants have also fell in arrears of rent payable

to the plaintiffs. As they did not vacate the premises even after

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receipt of the notice, the plaintiffs have filed the Suit seeking the

aforesaid reliefs.

6) The original plaint was filed against Aditya Motors as 1 st

defendant as lease deed was executed in favour of M/s.Aditya

Motors. It is shown in the said original plaint that the said 1 st

defendant Aditya Motors was represented by Pilla Durga Prasad.

The lease deed was also executed by the 1st plaintiff on his behalf

and on behalf of the 2nd plaintiff in favour of the 1st defendant

Aditya Motors only. So, the original plaint was filed only against

Aditya Motors showing it as 1st defendant as a lessee.

7) Thereafter, while the Suit, which was instituted in the year

2012 was pending, six years thereafter, in the year 2018, the

plaintiffs have filed a petition in I.A.No.237 of 2018 under Order 6

Rule 17 CPC to amend the plaint. The said petition was allowed

as per order, dated 28.03.2018. As per the said amendment, the

lessee Aditya Motors was completely deleted as a party from the

Suit in the plaint and the name of Pilla Durga Prasad is added as

1st defendant in the Suit as representative of Aditya Motors. So,

the 1st defendant Aditya Motors is now substituted with Pilla

Durga Prasad showing him as 1st defendant in the amended

plaint.

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8) After the plaint was amended deleting Aditya Motors as a

party to the Suit as 1st defendant and substituting it with the

name of Pilla Durga Prasad, the defendants have filed petition

under Order 7 Rule 11 and Section 151 CPC to reject the plaint on

the ground that admittedly as per the registered lease deed, dated

13.04.2005, it is M/s.Aditya Motors, represented by its proprietor

P.D.Prasad, is the lessee and the Suit was originally filed against

Aditya Motors showing it as a lessee and now the plaint is

amended deleting Aditya Motors as a defendant and substituting

it with Pilla Durga Prasad as 1st defendant as lessee, and in fact,

Pilla Durga Prasad is not a lessee even as per the lease deed and

as such, the plaint does not disclose any cause of action against

the 1st defendant Pilla Durga Prasad. Therefore, it is prayed to

reject the plaint.

9) The said interlocutory application was opposed by the

plaintiffs stating that M/s.Aditya Motors is a proprietary concern

and Pilla Durga Prasad is carrying on the said business in the

trade name of M/s.Aditya Motors and proprietary concern is not a

juristic person and it cannot be sued and only the person who is

carrying on the business in the said trade name can only be sued

and as such, the plaintiffs sought amendment to sue Pilla Durga

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Prasad, who is carrying on the said business in the trade name of

Aditya Motors to overcome any technical defect in filing the Suit.

It is stated that as Pilla Durga Prasad is the proprietor of the said

M/s.Aditya Motors, he is to be sued and accordingly, the plaint is

amended to sue him. Therefore, the plaintiffs have prayed to

dismiss the said petition.

10) The trial Court, after considering the aforesaid rival

contentions of both the parties, held that M/s.Aditya Motors is

the proprietary concern and its proprietor is Pilla Durga Prasad

and originally the Suit was filed showing Aditya Motors as 1st

defendant and the plaintiffs got amended the plaint and have

shown its proprietor as 1st defendant and as such, it does not

make any difference like the firms and as the plaintiffs are the

landlords that the plaint cannot be rejected as sought for and

thereby dismissed the said petition.

11) Aggrieved thereby, the present Civil Revision Petition is filed

assailing the impugned order.

12) Sri S.S. Prasad, learned Senior Counsel appearing for the

revision petitioner/1st defendant, would vehemently contend that

admittedly the lease deed was executed in favour of M/s.Aditya

Motors and the plaintiffs have also rightly filed the Suit showing

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Aditya Motors as 1st defendant in the original plaint and the

plaintiffs themselves have erroneously got the plaint amended and

got the name of Aditya Motors deleted as 1st defendant and

substituted it with Pilla Durga Prasad as 1st defendant in his

individual capacity and he is not the lessee and the lease deed in

question was not executed in his favour in his individual capacity

and as such, he cannot be sued and the plaint does not disclose

any cause of action against him. He would contend that as the

plaintiffs themselves got the plaint amended by deleting Aditya

Motors, which is the original lessee, as defendant and impleaded

Pilla Durga Prasad as a defendant, that the defendants are now

constrained to file this petition under Order 7 Rule 11 CPC to

reject the plaint as it does not disclose any cause of action against

Pilla Durga Prasad. He would contend that the trial Court did not

properly appreciate the legal position in this regard and

erroneously dismissed the petition. He contends that the

contention of the plaintiffs that a proprietary concern i.e.

M/s.Aditya Motors cannot be sued and as such they got the plaint

amended is legally not correct and Order 30 Rule 10 CPC clearly

mandates that a proprietary concern can also be sued. He would

vehemently contend that proprietary concern cannot sue, but it

can be sued, which is clear from Order 30 Rule 10 CPC.

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Therefore, when a proprietary concern can be sued, on account of

the fact that the plaintiffs themselves got deleted the said

proprietary concern Aditya Motors as a defendant to the Suit,

which is the original lessee, the Suit against an individual is not

maintainable and it does not disclose any cause of action at all

against an individual. Therefore, he would pray to set aside the

impugned order and allow the petition of the defendants and reject

the plaint.

13) Per contra, Smt.V.Dyumani, learned counsel for respondents

1 and 2, would submit that unlike a company, proprietary

concern is not a juristic person and it cannot be sued and a

proprietary concern is only a trade name, in which, an individual

carries on his business sand as such, to rectify the said defect in

the original plaint that the plaintiffs have got the plaint amended

and got deleted Aditya Motors as 1st defendant and impleaded Pilla

Durga Prasad, who is the proprietor of the said proprietary

concern as 1st defendant. So, she would contend that the

contention of the defendants that the plaint does not disclose any

cause of action against Pilla Durga Prasad is not correct.

Therefore, she would pray for dismissal of the revision petition.

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14) The admitted facts are that the plaintiffs are the joint owners

of the plaint schedule premises. The 2nd plaintiff has given

authorization to the 1st plaintiff to enter into a lease deed on his

behalf also. Therefore, the 1st plaintiff has on his behalf and on

behalf of 2nd plaintiff, executed the suit lease deed, dated

13.04.2005, leasing out the plaint schedule premises to

M/s.Aditya Motors. Therefore, admittedly M/s.Aditya Motors is

the lessee as per the registered lease deed, dated 13.04.2005. It

was leased out to M/s.Aditya Motors. After expiry of the lease

period by efflux of time, the plaintiffs have also issued a legal

notice to Aditya Motors only before filing the Suit. Thereafter, the

plaintiffs have filed the Suit against Aditya Motors only showing it

as 1st defendant, which is the lessee as per the lease deed, and

also showing defendants 2 to 4 alleging that they are inducted by

Aditya Motors in the plaint schedule premises without the consent

of the plaintiffs. Therefore, as the lease agreement was executed

in favour of M/s.Aditya Motors, a proprietary concern, the plaint

was originally rightly filed against Aditya Motors showing it as 1st

defendant. But, the plaintiffs have themselves got the plaint

amended subsequently deleting Aditya Motors, which is a lessee,

as per the lease deed, as 1st defendant and substituted it with Pilla

Durga Prasad as the 1st defendant. The lease deed was not

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executed in favour of Pilla Durga Prasad. Therefore, as per the

lease deed, he is not the lessee. As noticed supra, it is the Aditya

Motors, which is the lessee. Now, the main ground on which the

plaintiffs got the plaint amended is that Aditya Motors is only a

proprietary concern and Pilla Durga Prasad is carrying on

business in the said trade name and as per law proprietary

concern which is not a juristic person cannot be sued and as

such, they got the plaint amended.

15) Therefore, the crucial question that is to be ascertained in

this lis is whether a proprietary concern which is not a juristic

person can be sued or not. If it is found that a proprietary

concern, though not a juristic person, can be sued, then it will

have its adverse effect on the amendment of the plaint and the

present Suit in its present form. Order 30 CPC deals with suits by

or against firms and persons carrying on business in names

other than their own. It consists of the Rules 1 to 10. Rules 1 to

9 thereof deal with suits by or against the firms and its partners.

Now, it is significant to consider Rule 10 of Order 30 CPC, which

is relevant in the context to consider, which absolutely clinches

the issue involved in this revision. For better appreciation, Rule

10 is extracted hereunder. It reads thus:

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"10. Suits against person carrying on business in name other than his own.--

Any person carrying on business in a name or style other than his own name, or a Hindu undivided family carrying on business under any name, may be sued in such name or style as if it were a firm name, and, insofar as the nature of such case permits, all rules under this Order shall apply accordingly."

16) A bare reading of the aforesaid provision makes it manifest

that a proprietary concern can be sued. It is clearly stated that

any person carrying on business in a name or style other than his

own name, or a Hindu undivided family carrying on business

under any name, may be sued in such name or style. So, the legal

position is now clear that when a person is carrying on a

business in a particular name or style, other than his own name,

or a Hindu undivided family carrying on business under any

name, it can be sued, in such name or style. So, eventhough, Pilla

Durga Prasad has been carrying on the said business in a trade

name Aditya Motors, Order 30 Rule 10 CPC clearly permits to sue

Aditya Motors in the said trade name. So, there is absolutely no

bar to sue a proprietary concern. Rule 10 of Order 30 CPC makes

the said legal position very clear and it clearly mandates that a

proprietary concern cannot sue in its name, but it can be sued in

its name.

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17) The said legal position is also clearly dealt with in the

judgment relied on by the learned counsel for the respondents

itself in the case of Shankar Finance and Investments v. State

of Andhra Pradesh1. At para.8 of the judgment, it is held as

follows:

"8. As contrasted from a company incorporated under the Companies Act, 1956, which is a legal entity distinct from its shareholders, a proprietary concern is not a legal entity distinct from its proprietor. A proprietary concern is nothing but an individual trading under a trade name. In civil law where an individual carries on business in a name or style other than his own name, he cannot sue in the trading name but must sue in his own name, though others can sue him in the trading name."

18) So, the legal position is clear from the judgment cited by the

learned counsel for the respondents 1 and 2 itself that a

proprietary concern cannot sue in its trading name, but it can be

sued in the trading name.

19) Therefore, when that be the clear legal position that a

proprietary concern can be sued in the trade name, the contention

of the learned counsel for the respondents that as the proprietary

concern cannot be sued that Aditya Motors is now deleted as a

1 AIR 2009 SC 422

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party and Pilla Durga Prasad is added as a party, cannot be

countenanced.

20) As noticed supra, the lease deed was executed in favour of

the proprietary concern i.e. Aditya Motors and it is rightly

originally shown as 1st defendant in the plaint and it was

subsequently, deleted as a party and Pilla Durga Prasad is shown

as 1st defendant in the present plaint. So, the present plaint does

not disclose any cause of action against Pilla Durga Prasad, who is

shown as 1st defendant. Order 7 Rule 11 CPC mandates that

when the plaint does not disclose a case of action, the same shall

be rejected. As the plaint does not disclose cause of action against

1st defendant Pilla Durga Prasad, the plaint is liable to be rejected.

21) The trial Court did not consider the said legal position under

Order 30 Rule 10 CPC. There is no discussion at all on it in the

impugned order. The trial Court completely missed its attention to

Order 30 Rule 10 CPC, which mandates that a proprietary

concern can be sued.

22) Therefore, the impugned order is not sustainable under law

and it warrants interference in this revision and the same is liable

to be set aside.

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23) Resultantly, the Civil Revision Petition is allowed. The

impugned order is set aside. I.A.No.429 of 2018 in O.S.No.118 of

2012 on the file of the IV Additional District Judge, Guntur,

stands allowed and the plaint is rejected under Order 7 Rule 11

CPC.

24) However, this will not preclude the plaintiffs from filing a

Suit against M/s.Aditya Motors, which is a proprietary concern,

which is a lessee under the lease deed. Learned Senior Counsel

for the petitioner also would submit that fresh Suit against Aditya

Motors is not barred. Therefore, liberty is granted to the plaintiffs

to institute a Suit against M/s.Aditya Motors. No costs.

As a sequel, miscellaneous applications, pending if any,

shall stand closed.

________________________________________________ JUSTICE CHEEKATI MANAVENDRANATH ROY Date:19-10-2023.

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